MPAA Wins Lawsuit Against Hotfile for Copyright Violations

In a major victory for the Motion Picture Association of America and its member studios, a Florida federal judge has ruled that Hotfile is liable for copyright infringement. According to the MPAA, the decision marks the first time a U.S. court has ruled against a cyberlocker regarding copyright infringement. Hotfile is one of the most popular cyberlockers and of the largest scale, but its claims of safe harbor from copyright liability and no indirect liability of its users failed.

The MPAA led the controversial and groundbreaking lawsuit on behalf of its members when it initially filed the lawsuit in February of 2011. The legal action represented an attempt to act against the growing popularity of cyberlockers. The final results of the ruling are expected in the upcoming weeks.

Hotfile, one of the top trafficked sites globally, was accused of allegedly storing thousands of copyrighted movies and TV shows. “During the lawsuit, Hotfile was charged with enabling copyright infringement ‘on a mindboggling scale,’ and deemed ‘more egregious’ than Napster, Grokster and Limewire and ‘indistinguishable’ from Megaupload,” explains The Hollywood Reporter.

Hotfile argued that it has safe harbor from copyright liability and has no indirect liability for what its users are doing. However, U.S. District Judge Kathleen Williams used rulings in other cases for her decision.

“This decision sends a clear signal that businesses like Hotfile that are built on a foundation of stolen works will be held accountable for the damage they do both to the hardworking people in the creative industries and to a secure, legitimate Internet,” said Senator Chris Dodd, chairman and CEO of the MPAA. “We applaud the court for recognizing that Hotfile was not simply a storage locker, but an entire business model built on mass distribution of stolen content.”

The reason why the MPAA targeted Hotfile may have to do with Anton Titov, a foreign national in Florida that was a co-defendant in the lawsuit for running Hotfile. Hotfile was operating within the U.S., unlike many other cyberlocker sites.

Titov fought the claim by referencing safe harbor provisions in the Digital Millennium Copyright Act, and counterclaimed that Warner Bros. was allegedly exploiting the site’s anti-piracy tool. “The basis of the allegation was that the studio was given a ‘Special Rightsholder Account’ that enabled it to delete or disable files that were believed to be infringing, and that Warners had ‘betrayed that trust’ by causing the deletion of thousands of files ‘when in fact Warner had no right to do so,” notes THR.

Judge Williams agreed with the MPAA and found Titov personally liable and rejected his DMCA claims.

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